Functional beverage startup Odyssey grabs $6M to accelerate energy drink growth

Odyssey, a mushroom-based functional energy beverage maker, raised another $6 million in an equity investment to give it $14 million in total funding since launching its first drink two years ago.

Odyssey’s products tap into the health benefits of Lion’s Mane and Cordyceps mushrooms to produce a drink that combines an energy boost with 2,750 milligrams of the mushrooms to provide cognitive clarity and focus.

Lion’s Mane, in particular, was shown to positively impact cognitive function and mood in young adults, according to a 2023 National Institutes of Health pilot study.

Scott Frohman, founder and CEO of Fort Lauderdale, Florida-based Odyssey, first learned about the benefits of certain mushrooms from a friend making a mushroom powder to mix in drinks.

“I started adding it to my coffee, and I realized that everything was more clear,” he told TechCrunch. “The best part was when I got to work, I realized that I didn’t need that second cup of coffee. On top of that, I just felt I was just more present and was able to jump to my work.”

However, Frohman didn’t exactly like how the powder affected the taste and texture of the drinks, and preferred an energy drink delivery, so he began working on Odyssey in 2021. Today, the company has 11 SKUs, including flavors like Passion Fruit Orange/Mango, Dragon Fruit Lemonade and Blackberry Lemon Twist.

The energy in the drinks come from a combination of L-Theanine, ginseng and green tea caffeine. And there is less added sugar to help minimize “the jitters” and sugar crashes typically associated with traditional energy drinks, Frohman said. For those who want even more of a caffeine boost, the company recently introduced the Odyssey 222 line with 222 milligrams of caffeine in addition to the mushrooms.

Over 5,000 stores, including Publix, CVS, GNC, Erewhon, 7-Eleven, Thrive Market, Wegmans and Bristol Farms carry Odyssey products. Frohman didn’t provide growth metrics, but did say the company is seeing sales pick up in terms of three to five cans per week per SKU being sold.

Growth in the functional beverage industry accelerated in recent years as consumers increasingly looked for healthier foods. The global functional soda category is expected to be valued at $208 billion by 2027. That’s inspired new brands to emerge and enticed some venture capitalists to invest in the sector.

During this time, we saw brands like healthier soda companies Poppi and Olipop grab capital in 2022, while The Ryl Company raised $6.7 million in early 2023 for its line of functional ready-to-drink tea.

Odyssey also joins a long list of companies leveraging mushrooms and mycelium, the root of the mushroom, to make everything from alternative proteins to leather-like materials to building materials. Companies like Infinite Roots are even growing mushrooms for commercialization purposes.

“As the timing is no doubt right, mycelium can win over consumers with taste, nutritional, functional, scalable and impact-related benefits,” said PeakBridge CTO Maya Schushan Orgad in a review of mycelium trends.

Meanwhile, Odyssey’s new funding round includes strategic investor Richard Laver from Rocket Beverage Group, who joins a group of existing stakeholders contributing 50% of the total raised amount.

Frohman plans to allocate the capital toward inventory to keep distribution going and hiring in the areas of sales and marketing.

“We don’t see this as just a product, but a whole movement,” Frohman said.